The daily Kommersant newspaper claimed that a government source said that EDF and Gazprom “would soon sign a memorandum of cooperation.”

In the deal EDF would receive 10 per cent of the equity in the South Stream pipeline, which intends to transport Russian gas via the Black Sea, to Europe.

EDF would receive a long-term deal for gas supplies via the pipeline, but the agreement rivals the EU-led Nabucco project, which plans to transport gas via Turkey, Bulgaria, Romania, Hungary and Austria.

French Prime Minister Francois Fillon was in Russia this week and it is believed the project was high on the agenda in his meeting with Prime Minister Vladimir Putin.

“Russian-French relations are making good progress,” Putin said on Monday. “We are active enough in every political field, and developing our economic contacts,” he added.

“Our economic partnership has a grand scale,” said Fillon.

Meanwhile, the second largest generator of electricity in France, GDF Suez, are also working towards involvement in the Nord Stream pipeline project, in which Gazprom owns a majority share. It plans to transport gas to Germany, via the Baltic Sea.